Québec Premier Jean Charest gets a reprieve for now as the separatist PQ has agreed to back down and not defeat the government on a Ways and Means Motion today that gives the people of Québec a 25% across the board income tax cut. In exchange Charest has agreed to boost social spending and regional development by $161 million. But the winner is still Charest -- because the reduction in paycheque withholdings goes into effect almost immediately.
Had Charest actually kept his promise to fully cut provincial income taxes four years ago rather than wait for a like-minded federal PM -- Harper -- to bail him out Charest would not have been backed into a corner like this. Charest will likely argue, however, Harper was actually complying with a section of the 1982 Constitutional Amendment that Québec has never recognized -- that the federal government was "committed" to ensuring provinces had enough money to ensure social services were provided across Canada at "comparable" levels of taxation.
By accepting the federal money to in turn fund a tax cut, Charest actually puts himself at the peril of future attack, that he sold out his principles to defend Québec's areas of jurisdiction. Why, will the PQ and ADQ say later on, didn't Charest instead argue for an increase of the federal abatement from 16.5% to, say, 25%? (The abatement is a line on the federal tax return, available only to Québecois, that ensures they pay less federal income tax as recognition for the much broader range of social services Québec provides for its people, that the feds handle in the other provinces and territories.)
Charest's response will likely be: I did something to stop the brain drain. We need our people to ensure our future development.
Sorry, Jean, but it's going to take a lot more than a tax cut to do that. I would have saved health, education and welfare first -- even if it meant a hike in tuition and the premiums for health care and prescription drugs.
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